“I buy on the assumption that they could close the market the next day and not reopen it for five years.”
— Warren Buffett
The Warren Buffett investment philosophy calls for a long-term investment horizon, where a five year holding period, or even longer, would fit right into the strategy. How would such a strategy have worked out for an investment into PG&E Corp (NYSE: PCG)? Today, we examine the outcome of a five year investment into the stock back in 2018.
| Start date: | 03/27/2018 |
|
|||
| End date: | 03/24/2023 | ||||
| Start price/share: | $43.94 | ||||
| End price/share: | $15.64 | ||||
| Starting shares: | 227.58 | ||||
| Ending shares: | 227.58 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | -64.41% | ||||
| Average annual return: | -18.68% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $3,560.24 | ||||
As we can see, the five year investment result worked out poorly, with an annualized rate of return of -18.68%. This would have turned a $10K investment made 5 years ago into $3,560.24 today (as of 03/24/2023). On a total return basis, that’s a result of -64.41% (something to think about: how might PCG shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
One more investment quote to leave you with:
“In the short run, the market is a voting machine but in the long run, it is a weighing machine.” — Benjamin Graham
